Freehold House with Leased Flat - CML 5.8.1?

small88

I have done much research on this the past week but cannot seem to come up wth a definitive answer to my situation and the estate agent and mortgage broker do not appear to fully grasp the situation.

The house is a victorian terrace with a self contained flat upstairs and down. For argument sake say these are flat 1 ground floor and flat 2 first floor sitting above the ground floor.

The titles of the property are that there is a freehold owned by the ground floor flat which has title relating to 1 and 2. 2 has its own title of a lease with 68 years remaining. I have seen a mortgage advisor and been advised that this will be classed as freehold flat. However from my reading i see this as a freehold house with a leased flat on the 2nd floor. It appears that the lease has all the correct easements and enforcements you would expect and from my understanding of a freehold flat the worry is that there is no legal obligation from another party say above or below to make repairs however under my current situation there is.

My question is what should this type of property be classed under for mortgage purposes? Do i state it is a freehold flat or a house with a leased self contained second floor? Also does the title stating 1 and 2 make a difference to this?

My mortgage brokers seem to say this has to go down as a freehold flat and that most lenders wont entertain it even if they state in the CML handbook to their part that they do!?

davidmcn

You're mortgaging both the freehold and leasehold interests? How is the property going to be occupied? (as a single house or flats, owner-occupied/tenants etc)? If you are (or become) both freeholder and leaseholder you could probably simplify things by getting rid of the lease.

small88

i am purchasing the ground floor flat. Which has title to freehold over both ground-floor and first floor. The first floor has a lease. There is no leasehold on the ground floor. So there will be occupancy on both flats/floors. Ground floor by myself, having freehold over both, and leasehold on first floor already in existence as is.